To some, he’s the agent of the 1%; to others, a voice of reason

Inside a state office building in downtown Albany, Edmund J. McMahon argued in favor of 401(k)-style pensions for New York’s government workers.

Outside on that early February morning, union members wave signs emblazoned: “EJ McMahon = agent of the 1%, wants to gamble your retirement security on Wall Street.”

Just another Thursday on the job for E.J. McMahon, the standard-bearer for a fiscally conservative approach to how New York state spends, taxes, borrows money, incentivizes private-sector growth, bargains labor contracts and structures benefits for state workers.

McMahon founded the Empire Center for New York State Policy in 2005. The think-tank is in Albany, capital of a state that is the most unionized in the nation, shaded blue on the electoral map.

But the positions McMahon advocates appear to resonate more in the present political and economic climate. Cutting the national deficit is among the hot topics in this election season. At the state level, New York Gov. Andrew Cuomo pushed a law to limit increases in property taxes, started to curtail spending and labeled his fiscal policies as those of a “progressive Democrat who’s broke.”

McMahon views his job as distilling complex policy into plain English. McMahon said he works to avoid inflammatory rhetoric or personal barbs, shooting for more substance and less ideology.

In a 15-minute span, McMahon can flash an encyclopedic memory that covers property tax rebates, pension reform of the 1950s, arbitration of police contracts and the drain of young workers from upstate. He is measured, but firm in his analysis.

“What helps is having the facts on your side,” said McMahon, 57. “It can morph into a sort of truth-squading, pointing out facts people prefer to ignore or aren’t aware of.”

The words of Richard Brodsky, who was a Democratic state assemblyman for nearly 30 years, illuminate the world in which McMahon operates. He has allies, for sure, but in a blue state, he has his share of foes.

“It is unfortunate that such a decent, charming, intelligent man has such terrible ideas,” said Brodsky, who has debated McMahon on the cable station YNN. “He is smart. He is intellectually rigorous. He is a good partner in the public debate.”

Then Brodsky adds this: “He is also wrong.”

McMahon’s backers are just as earnest.

“He seems to be the go-to guy for anything anyone’s ever wanted from a fiscally conservative point of view. And he’s never disappointed,” said David Shaffer, a senior fellow at the Rockefeller Institute of Government, a research arm of the State University of New York, located in Albany.

“E.J. started off behind the 8-ball. The idea government could spend less and New York’s taxes could be lower? That was rejected out of hand by just about everyone,” Shaffer said. “The dialogue in state politics today is no accident.”

A lifelong New Yorker, McMahon initially followed his mother into print journalism, reporting on school and city budgets and fiscal issues in Westchester County and in Albany. He retains that reporter streak, working two computers plus an iPad propped up by a stapler, near notes scribbled on paper plates.

Following his time in newspapers, McMahon pursued fiscal policy research and advocacy while working for Shaffer twice at The Business Council of New York State Inc., a lobby involving major corporations in the state.

“He took to it like a duck to water. He was born to research New York state policy and government issues, with a point to it,” Shaffer said. “His perspective is not entirely neutral. It shouldn’t be.

“He figured out how to make it so ordinary people could make sense of it,” Shaffer added.

McMahon was also chief fiscal adviser to Assembly Republicans, a deputy commissioner in the state tax department, and later in charge of external relations for SUNY before taking on the think tank role. McMahon also raised seven children, now ages 13 to 33, in Schoharie.

You might expect his chief frustration to be working in a state that, as he put it, “seems committed to a status quo of big government and high taxes.” But that doesn’t bother him so much.

“My biggest concern? People who have a real stake—foremost the businesses who employ people, own property, buy local goods and services—are not seen and heard from,” he said. “It’s a surprise and a disappointment. Business owners, the people who have the greatest stake in the community, a literal, physical stake in New York, are less engaged and less involved. And it’s not because somebody is shutting them down. You just don’t get the sense they’re involved.”

Labor unions are much louder in the halls of the Capitol. Unions often approach McMahon’s pursuit of pension reform as an affront on workers that undermines a critical benefit used to attract talented people to public service.

In it, Mencken talks of “vastly enjoying opposition” and debating “in the manner of a gentleman fighting a duel, not in that of a longshoreman clearing out a waterfront saloon. That is to say ... assuming that his opponent is as decent a man as he is, and just as honest—and perhaps, after all, right.”

Here’s how McMahon translates that to the debate over pensions. He wants the state to institute the 401(k) model—common in today’s private sector—versus its current pensions, which are determined more by formulas factoring in pay and years of service, and less by actual investment returns.

“You have to strike a balance between paying a good and fair wage that attracts qualified people, and the need to produce a budget that’s sustainable and affordable,” McMahon said.

“People tell me I’m anti-union, anti-worker. What drives much of government is how many people you employ and what you pay them. It’s just where the money is,” he said.

It’s a response that doesn’t immediately shout “agent of the 1 percent” who wants to gamble on Wall Street, as those union members protested earlier this year.

“Now, I mean, that’s just silly,” McMahon says. “Where do they think the $150 billion in the state pension fund is, anyway? Do they think it’s locked away, magically growing at a rate of 8 percent a year because [state comptroller] Tom DiNapoli pours water on it?”

McMahon is quick to add a lament about pensions that also, in a way, expands his to-do list.

“We still have yet to have a serious conversation on that, frankly,” he said. “In many ways, this is a dream job, to be able to deal with issues like that.”